TKR
The Timken Company
$116.58
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 89.1% above fair value
You pay
$116.58
Bear
$49.32
Fair
$61.65
Bull
$73.98
Bear
$49.32
-57.7%
$4.11 × 12x P/E
Fair
$61.65
-47.1%
$4.11 × 15x P/E
Bull
$73.98
-36.5%
$4.11 × 18x P/E
Adjust Assumptions
15.0x
4.11$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
28.4x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (24 analysts)
$142.86
Divergence from AlphaVal
57%
Summary
Applying a 15x P/E to adjusted EPS of $4.11, the base-case value is $61.65 per share. DDM cross-check: $29.77.
Warnings
Dividend-based valuation: $29.77 (below our primary estimate by 52%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $142.86 (from 24 analysts). Our estimate is 57% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples